1. If Mickey and Sam want to formally organize their business the most appropriate thing for them to do is to create a partnership. A partnership is a business or firm being run by two or more people. Just starting out a business is hard but they do have many available resources and a general partnership will also be beneficial to them. When the business gains customers and resources they can involve their business. Mickey and Sam will equally share responsibilities, liabilities, profit, and losses according to the portion that each of the individuals contributes. A partnership is can provide a business with structure and control along with many other benefits.
2. This contract is entered between Mickey Bullets and Sam Superstar of Tours, Tours and More Tours (“First Party”), and Jessica of BBQ and Brisket restaurant (“Second Party”). The terms of this agreement will begin on April 21, 2016, and can be renewed for 12 months. The First Party covenants and agrees that each tour will stop by the BBQ and Brisket restaurant. The Second Party covenants and agrees that it will pay $50.00 for each tour that visits the BBQ and Brisket restaurant. This document and any attachments constitute the agreement between the two parties. This contract is legally binding upon the parties, their successors, heirs, and assigns and shall be enforced under the State of Anytown.
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Jessica is only 17 years old and that could become a potential issue until she is the legal age, she is not legally required to carry out her contract. Legal ages vary depending on the state of which you live in. Majority of states consider 18 to be the legal age, but in other states, it is 19 or 21.
3. Expanding your business means the potential for increased revenue and profits which is a good thing for a business owner. Making a decision is important if you want to decide if you want to make the existing business a limited liability company or incorporate. Limited liability companies or corporations are considered to be legal entities which allow the company to be responsible for paying their own debt. Different characteristics should be taken into consideration of each market. Doing your research is also an important factor to know the ins and outs of an area you are looking to expand in or to and knowing the existing competitors in the new area. Before the hiring process begins to make sure you apply for a federal employer identification number so you can hire employees legally. Once you have new hire employees, remember that collecting payroll taxes and adhering to any state and federal labor regulations applicable to the industry. By putting the most time, efforts, and money into your business, it shows potential investors that you are committed to the business and your business goal. Ask other investors for ideas on how to achieve these goals.
4. I would respond by saying this business is a partnership between Mickey and Jessica. Mickey should have included Jessica in his doing of investing and meeting with investors and promising them returns on their investments. By him not including Jessica in the decision making he has made Jessica liable for the investments and the 10% returns. Mickey must not indulge himself at the expense of the partnership. Mickey also has to provide financial accounting information to his partner. He has violated his duty and can be sued for the damages caused by his actions. One of the potential drawbacks of a partnership between two parties is that the other partner involved are bound to contracts signed by one another on behalf of the partnership. Mickey is not doing anything illegal when he meets with the investors or promises to return 10% of their investments but he did violate the loyalty agreement by not including Jessica in the meets with the investors.